2,3,7,8-Tetrachlorodibenzo-p-dioxin (TCDD) inhibits the androgen-dependent processes by which the urogenital sinus (UGS) of fetal mice forms prostatic epithelial buds. This inhibition is mediated by aryl hydrocarbon receptors in UGS mesenchyme and causes prostate lobes to develop abnormally. Experiments were conducted to test the hypothesis that TCDD inhibits prostatic budding in C57BL/6J mice by inhibiting androgen signaling. In utero TCDD exposure sufficient to inhibit budding (5 μg/kg maternal dose on gestation day [GD] 13) had no effect on testicular testosterone content on GD 16 or 18. Nor did it inhibit the conversion of testosterone to 5α-dihydrotestosterone (DHT) by the UGS. Both hydroxyflutamide (OH-flutamide; a competitive androgen receptor antagonist) and TCDD inhibited prostatic epithelial budding by UGSs cultured in vitro with DHT. To determine if TCDD inhibits responsiveness to androgens, primary mesenchymal cells prepared from UGSs cultured for three days with DHT were transiently transfected with an androgen-responsive reporter plasmid (MMTV-luciferase). OH-flutamide prevented DHT from increasing luciferase activity in these cells but TCDD did not. The same results were obtained when the mesenchymal cells were isolated from UGSs cultured with both DHT and TCDD. The lack of effect of TCDD on androgen-dependent gene expression was not due to inability of transfected UGS mesenchymal cells to respond to TCDD, as shown by significant increases in luciferase activity after transfection with plasmids containing CYP1A1 and CYP1B1 promoters. Finally, while OH-flutamide prevented DHT from altering androgen receptor and 5α-reductase type II mRNA expression in UGS organ culture, TCDD had no such effects. Collectively, these results suggest that TCDD inhibits prostatic epithelial bud formation without impairing the androgen receptor signaling pathway.